Study of QS and other EV battery design companies
- 01/06/2020 – QS’s current share outstanding is 207 mil, by adding 306M more, the price is likely to drop. Therefore, we saw the sizable plunge in the stock price on Monday
QuantumScape clarifies yesterday’s share registration
Jan. 05, 2021 9:48 AM ETQuantumScape Corporation (QS)By: Stephen Alpher, SA News Editor22 Comments
QuantumScape (NYSE:QS) yesterday registered for sale up to 306M shares by selling shareholders. The news may have contributed to a sizable plunge in the stock price.
The company attempts to clean things up this morning, noting the purpose of the filing was only to register shares for possible sale, and that nearly all the registered shares remain subject to lockup agreements.
The stock is about flat in morning action today.
- 01/05/2020 – hard to explain the stock’s 40% drop in one day. Maybe profit taken, maybe negative comments on seeking alpha. May be registration statement became effective in late Dec. Anyway, watch out the share lockup date in May and warrants exercisable at Midyear. Another good idea: look to buy QS.WS, might be better return than QS
QuantumScape’s CEO Talked About the Stock’s 40% Drop. A Clear Reason Is Hard to Find
Management at electric-vehicle battery pioneer QuantumScape appears to be as puzzled by Monday’s 41% stock price drop as anyone else.
QuantumScape (ticker: QS) started 2021 by dropping from more than $84 per share to less than $50 in just one trading session. Its market capitalization, based on about 448 million fully diluted shares outstanding, fell from almost $38 billion to a little more than $22 billion.
Company CEO Jagdeep Singh appeared on CNBC Monday evening, and the topic of the steep stock decline came up. And while Singh didn’t pinpoint one single reason for the drop, his comments were reasonable. “We can’t predict short-term stock market volatility,” he said, but he believes not a lot has changed for the company. Quantum presented what he believes is strong technical data in December. And he noted that risks remain in the commercialization and manufacturing of QuantumScape’s new solid-state rechargeable EV battery technology.
Singh also mentioned that the company’s registration statement became effective in late December. Typically, that isn’t an event that requires regular investors to pay much attention. But registration effectiveness does free up some stock to be sold, and that can be one reason for a selloff.
Still, that may not explain the staggering pace of the decline. For starters, the stock now available for sale is held by mainly early investors and institutions. They have made money in Quantum shares, but are also longer-term holders. What’s more, the vast majority of stock is still locked up, held by company insiders. Those lockups won’t expire until May.
What’s more, warrants issued as part of the SPAC merger aren’t exercisable until midyear. Warrants that give holders the right to buy a stock for a fixed price—$11.50 in Quantum’s case—are a common feature of SPAC transactions, the kind Quantum used to become a publicly traded company. With Quantum stock at about $50, there is a potential profit for warrant holders. Quantum warrants are trading for about $27.
“At the end of the day supply and demand have to come into balance,” added Singh. Barron’s suggested Monday people were taking some money off the table after making a huge profit late in 2020. That is still our best guess.
seeking alpha’s negative view on this might be another major contributor
QuantumScape’s Solid State Batteries Have Significant Technical Hurdles To Overcome
- QuantumScape’s science is very good.
- But their batteries are small and unproven – not yet as big as an iWatch battery, and never tested outside a lab.
- There are significant risks associated with solid state batteries that have not been overcome – a list below.
- They will likely never achieve the performance they claim.
need to study more details on the following readers’ comments
(Ethan Oksen, 6 hours ago, QS ran up so fast in the first place because of a short squeeze. Short utilization is at 99% with a 477% borrow fee at the moment. Only around 20 million shares are available on the market right now, and the newly registered shares will bring the total sellable float to closer to 60 million, which will make shorting this stock a lot easier and is part of the reason for the sell-off.
- 12/31/2020 – GMO’s Jeremy Grantham put $12.5 million into QuantumScape seven years ago as a personal investment
QuantumScape Was Unknown. Now It’s One of the Most Valuable Stocks in the Car Industry.
On Tuesday, Quantum stock was worth $59 billion, based on fully diluted 448 million pro forma shares outstanding. The company passed rivals, including LG Chem, Samsung SDI, and Panasonic, in market value. One exception: China’s Contemporary Amperex Technology, which was worth roughly $110 billion. But Quantum was also larger in market value than Ford Motor and General Motors, every auto component of the Russell 3000 except Tesla, and two of the largest auto-parts companies in the world, Japan’s Denso and Germany’s Continental. The shares fell back later in the week to a market cap of $51 billion.
QuantumScape went public in a merger with a special purpose acquisition company, or SPAC, Kensington Capital Acquisition. GMO’s Jeremy Grantham put $12.5 million into QuantumScape seven years ago as a personal investment, a 4.8-million-share stake now worth $551 million. He hasn’t sold any shares. Grantham dislikes SPACs, he told the Financial Times, but the stake “accidentally” turned into the largest investment he has ever made.
Race to the Top
QuantumScape has quickly climbed into the top ranks by value of auto-related companies.
Source: Marketwatch
- 12/08/2020 – good to start to study the EV battery companies such as QuantumScape (QS)
QuantumScape: Searching For The Holy Grail Of Battery Design
- QuantumScape is the latest addition to the NYSE after a merger with Kensington Capital.
- The company joins the electric vehicle investor space with a promise of a battery technology that may provide the step-change that will put EVs into the mainstream market.
- The restricted float and the hot market for EV stocks open up the possibility of a price bubble in the stock.
- But competition will be fierce, there is no guarantee of long-term success.
QuantumScape Is ‘Hitting a Home Run’ in Battery Technology. Its Stock Soars
Experts called data from solid-state battery start-up QuantumScape a home run. That vote of confidence is helping shares add to recent gains.
QuantumScape (ticker: QS) conducted a virtual battery showcase on Tuesday, giving investors and analysts a chance to examine the technology Quantum has developed and learn which solid-state battery technologies haven’t worked so far.
QuantumScape didn’t call out competition by name but management did point out that other attempts involving different types of cell separators, including polymers and sulfides, haven’t panned out.
